| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | - | - |
Advisory Research identifies a significant rotational shift in U.S. equity leadership that began in late 2025 and has persisted through Q1 2026. Value stocks have delivered their strongest relative performance versus Growth since 1991, with this trend continuing despite geopolitical shocks from U.S. military actions in Iran. The rotation reflects a broader market transition away from duration-sensitive growth leadership toward companies offering more immediate cash flow visibility. Higher-yielding dividend stocks have similarly outperformed the broader market, particularly in the U.S. where the distinction between income-oriented and growth-oriented companies is most pronounced. This performance aligns with the value rotation given the overlap between dividend-paying and value-oriented stocks. The manager notes this dynamic does not imply a uniformly weak market environment, but rather represents a fundamental shift in leadership preferences. The underlying structure of this rotation has proven more stable than expected in an event-driven environment, suggesting the trend may have staying power beyond short-term market disruptions.
A meaningful rotational shift in U.S. equity leadership has emerged, favoring cash-flow-sensitive value stocks and higher-yielding equities over duration-sensitive growth stocks, representing the strongest relative start for Value versus Growth since 1991.
The rotational shift toward value and dividend-paying stocks appears to have been underway entering 2026 and has persisted through external shocks, suggesting this trend may continue.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Apr 13 2026 | 2026 Q1 | - | cash flow, dividends, Leadership, Rotation, value, Yield | - | Value stocks are experiencing their strongest relative performance versus Growth since 1991, with dividend-paying equities similarly outperforming. This rotational shift toward cash-flow-sensitive companies has persisted through geopolitical shocks, suggesting a fundamental change in market leadership away from duration-sensitive growth stocks toward companies with immediate cash flow visibility. |
| Jan 8 2026 | 2025 Q4 | IEV, SPY | AI, Deregulation, Europe, Fiscal, global, inflation, nuclear, oil | - | Advisory Research expects global economic reacceleration driven by coordinated fiscal stimulus, with Europe outperforming the US through Germany's shift to fiscal expansion. Manager remains very bullish on global equities despite anticipating higher market volatility and sticky US inflation. Key opportunities include AI becoming practical, nuclear fusion breakthroughs, rising oil prices, and financial deregulation benefiting banks. |
| Oct 8 2025 | 2025 Q3 | GM, NKE | AI, China, dividends, Europe, global, infrastructure, rates, tariffs | - | Advisory Research delivered 23.89% net YTD returns while positioning for multi-year global growth cycle. Managers dismiss AI bubble concerns and stagflation fears, expecting Fed rate cuts and major fiscal stimulus from Germany, EU, and China to drive positive economic surprises into 2026. Remain very bullish on global equities despite tariff uncertainty. |
| Jul 2 2025 | 2025 Q2 | - | Europe, Fed, Fiscal, global, growth, inflation, tariffs, Trade | - | Advisory Research sees Trump's tariffs as negotiating tactics leading to trade deals within 90 days. The real opportunity is Europe's fiscal pivot from austerity to 5-6% GDP deficit spending while the U.S. faces fiscal tightening. This structural shift, combined with USD weakness and global diversification trends, supports their bullish global equity positioning despite near-term U.S. policy volatility. |
| Apr 21 2025 | 2025 Q1 | - | dividends, fiscal policy, global, rates, Recession, tariffs, Trade Policy | - | Advisory Research expects Trump's tariff threats to result in negotiated deals rather than trade war, with actual rates settling much lower than stated. Global fiscal pivot anticipated with European coordination and Chinese stimulus. Despite recession fears, strong US fundamentals and negative sentiment create attractive global equity opportunities. Fed cuts likely if labor softens. |
| Feb 19 2025 | 2024 Q4 | - | China, Europe, Fed, growth, policy, rates, tariffs | - | Manager expects higher-than-anticipated tariffs but views deregulation and smaller government as offsetting positive supply shocks. The economic setup mirrors the successful mid-1990s environment with healthy balance sheets, productivity growth, and Fed flexibility. Global policy shifts in China and Europe provide additional tailwinds despite near-term trade war volatility. |
| Feb 19 2025 | 2024 Q4 | - | China, Europe, Fed, growth, policy, rates, tariffs | - | Manager expects higher-than-anticipated tariffs but views deregulation and smaller government as offsetting positive supply shocks. The economic setup mirrors the successful mid-1990s environment with healthy balance sheets, productivity growth, and Fed flexibility. Global policy shifts in China and Europe provide additional tailwinds despite near-term trade war volatility. |
| Oct 28 2024 | 2024 Q3 | - | Defensive, Dividend, Election, Fed, rates, small cap | - | Federal Reserve's proactive rate cutting cycle mirrors the successful 1995 playbook, cutting into strength rather than weakness. Defensive investor positioning and low margin debt create favorable technical setup for continued equity gains. The Fed Put is back with employment mandate prioritized, making recession unlikely. Post-election positioning shifts should drive further rallies. |
| Aug 13 2024 | 2024 Q2 | NVDA | dividends, Fed policy, global, Recession, small caps, technology | - | Advisory Research stays bullish on global equities despite summer volatility, expecting Fed rate cuts to secure a soft landing. Their dividend strategies outperformed peers while Small Cap Core beat Russell 2000 by 7.4%. With recession fears overblown and bearish sentiment creating opportunities, they see continued upside in global markets. |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2026 Q1 |
ValueValue stocks have experienced their strongest relative start versus Growth since 1991, with this rotational shift persisting through geopolitical shocks. The transition represents a move away from duration-sensitive growth leadership toward companies with more immediate cash flow visibility. |
Value Growth Rotation Cash Flow Leadership |
DividendsHigher-yielding equities have outperformed the broader market year-to-date, particularly in the U.S. where the distinction between income-oriented and growth-oriented companies is more pronounced. This performance is consistent with the broader shift toward value-oriented stocks. |
Dividends Yield Income Outperformance | |
| 2025 Q4 |
AIManager disagrees with AI bubble narrative, believing 2026 will see AI efforts become less speculative and more focused on real-world applications. Views generative AI as a general-purpose technology like steam engine or electricity with ability to improve over time and serve as platform for new innovations. |
Artificial Intelligence Technology Innovation Applications |
EuropeEuropean equities nearly doubled SPY performance in 2025 with +31.4% returns versus +17.7% for US. Fundamental paradigm shift in Germany abandoning fiscal austerity for fiscal excess, removing debt brake to increase deficit spending to 5-6% of GDP targeting defense and infrastructure. |
European Equities Germany Fiscal Policy Infrastructure | |
InflationExpects inflation to remain well anchored in all regions except US where consumers with extra cash could drive inflation higher. Combination of refunds and lower withholdings will frontload OBBBA benefits into 2026, potentially making US inflation stickier as economy reaccelerates. |
Inflation Monetary Policy Consumer Spending | |
Private CreditExpects Private Markets to underperform Public Equity markets again in 2026 for fourth consecutive year. Private Funds continue aggressive capital deployment with more capital calls than cash returns for fifth straight year, indicating too much capital chasing too few good opportunities. |
Private Equity Venture Capital Capital Allocation | |
OilOil prices expected to climb into $60-70 per barrel range by Q4 2026 as demand drivers exhibit firmer underlying consumption amid more constrained supply growth than widely assumed by market that believes oil is oversupplied. |
Oil Prices Energy Supply Demand | |
NuclearAI race catalyzes nuclear fusion research with at least three private-sector companies expected to achieve Net Energy Gain milestone in new year. One expected to reach Sustained High-Power Density Operation viable for fusion power plant by late 2026. |
Nuclear Fusion Energy Innovation Technology | |
| 2025 Q3 |
AIManagers are bullish on AI as a general-purpose technology entering implementation phase. They dismiss AI bubble concerns, noting infrastructure investment is only 0.5% of GDP versus 1.2% for telecom in 1999. AI will transform businesses by replacing specific tasks in coding, customer service, and management functions. |
Artificial Intelligence Productivity Infrastructure Technology |
Trade PolicyTrump's tariffs remain central focus with Supreme Court likely to rule against blanket universal tariffs. Managers expect more narrow but higher sectoral tariffs under national defense guise. They view tariffs as anti-growth tax hikes rather than inflationary, noting low corporate pass-through rates. |
Tariffs Supreme Court National Defense Corporate Earnings | |
Infrastructure SpendingMajor fiscal pivot occurring outside US with Germany abandoning austerity to increase deficit spending to 5-6% of GDP on defense and infrastructure. European Union boosting growth through significant public spending on infrastructure, digitalization, and defense. China fired fiscal bazooka worth 2% of GDP. |
Fiscal Policy Defense Digitalization Economic Growth | |
RatesFed expected to cut 75-100 basis points over next 12 months to support labor market while acknowledging 2% inflation target is arbitrary. Current environment lacks previous recessionary imbalances with soon-to-be neutral monetary policy supporting economic stability. |
Federal Reserve Interest Rates Monetary Policy Labor Market | |
InflationInflation above Fed's 2% target but remains mild with goods inflation not contributing to recent CPI uptick. Labor market leads inflation, so it should remain benign if employment stays sluggish. Current scenario shows employment and inflation moving in opposite directions signaling economic transition. |
Consumer Prices Employment Economic Transition Federal Reserve | |
| 2025 Q2 |
Trade PolicyTrump's tariff strategy viewed as negotiating tactic to generate tax revenue and finance tax cuts. Expected trade deals with UK, EU, Japan, Korea, Mexico, and Canada within 90 days. Tariffs likely negotiated down to ~10% for most countries except China at ~30%. |
Tariffs Trade Deals Tax Revenue Negotiation China |
RatesFed unlikely to cut rates pre-emptively before September but narrative will shift to how many cuts needed to stabilize labor and housing markets. Market pricing Fed Funds at 3% by end of 2026. Fed wants to avoid recession at all costs. |
Fed Funds Rate Cuts Labor Market Housing Recession | |
InflationTariffs are not inflationary but rather a tax hike that is anti-growth. Consumer prices remain in steady downtrend despite $100B in tariff duties. Businesses front-loaded inventories and are reluctant to pass price increases to customers. |
Consumer Prices Tariff Impact Inventory Margins Deflation | |
EuropeGermany abandoning fiscal austerity for fiscal excess, increasing deficit spending to 5-6% of GDP. EU boosting growth through infrastructure, digitalization, and defense spending. Fiscal coordination and rate cuts will drive positive economic surprises. |
Germany Fiscal Spending Infrastructure Defense Growth | |
| 2025 Q1 |
Trade PolicyManager analyzes Trump's tariff strategy as negotiating tactic rather than permanent policy, expecting tariffs to be negotiated down to ~10% for most countries and ~30% for China. Views tariffs as anti-growth tax on consumers that could trigger recession if implemented at stated levels. |
Tariffs Negotiation China Tax Recession |
RatesFed expected to cut rates if labor market softens, even with higher inflation. Manager believes central banks will remain proactive to avoid recession. Rate cuts and fiscal coordination expected in Europe as 2024 headwinds turn into 2025 tailwinds. |
Fed Labor Market Inflation Europe Monetary Policy | |
GlobalPositive fiscal pivot happening outside the US with expected surprises in Europe and China. European rate cuts and fiscal coordination anticipated, while China waits to deploy fiscal stimulus once Trump's endgame becomes clear. |
Fiscal Policy Europe China Coordination Stimulus | |
| 2024 Q4 |
Trade PolicyManager expects Trump to implement tariffs at levels higher than most investors anticipate, viewing them as a tax hike rather than inflationary policy. Tariffs are seen as a revenue source to finance tax cuts and provide negotiating leverage on defense spending, immigration, and fentanyl issues. |
Tariffs Tax Revenue Negotiation Supply |
Industrial PolicyDeregulation and smaller federal government through DOGE are viewed as positive supply shocks that could offset negative impacts from tariffs. These policy changes are expected to provide meaningful economic benefits through reduced regulatory burden. |
Deregulation DOGE Supply Regulatory Government | |
| 2024 Q4 |
Trade PolicyManager expects Trump to implement tariffs at levels higher than most investors anticipate, viewing them as a tax hike rather than inflationary policy. Tariffs are seen as a revenue source to finance tax cuts and provide negotiating leverage on defense spending, immigration, and fentanyl issues. |
Tariffs Tax Revenue Negotiation Supply |
Industrial PolicyDeregulation and smaller federal government through DOGE are viewed as positive supply shocks that could offset negative impacts from tariffs. These policy changes are expected to provide meaningful economic benefits through reduced regulatory burden. |
Deregulation DOGE Supply Regulatory Government | |
| 2024 Q3 |
RatesThe Fed kicked off the cutting cycle with a rare half point cut and is being proactive to preempt labor market weakness. The Fed realizes interest rates are very restrictive and believes neutral rate is 150-175 bps lower than current Fed Funds rate. Past proactive rate cuts in 1995, 1984 and 1966 led to equity rallies of ~20% within the first year. |
Fed Cutting Neutral Proactive Restrictive |
Risk AppetiteRisk sentiment is surprisingly neutral at best with investors positioned defensively and margin debt remaining low. The majority of investors have taken a dour view on the economy despite major equity markets being up ~20% YTD. The Fed Put is back as recession is not an option with the FOMC pivoting to maximum employment mandate. |
Defensive Sentiment Margin Fed Put Employment | |
| 2024 Q2 |
DividendsThe Select Dividend strategies have mostly kept pace with their broad strategy benchmarks year-to-date despite the narrowly driven tech market. The strategies remain in the top quartile of their peer group for the YTD period. |
Dividend Income Yield Distribution |
Small CapsThe Small Cap Core strategy has strongly performed year-to-date, outperforming the iShares Russell 2000 ETF by 7.4% on a net basis. Small Cap Core benefits from less index concentration, particularly in technology, allowing the disciplined investment process to capture idiosyncratic alpha. |
Small Cap Russell 2000 Alpha Concentration |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| No Elevator Pitches found | ||||||||||
| TICKER | COMMENTARY |
|---|---|
| No ticker commentary found. | |
| Ticker | Put/Call | Amount Bought | Shares Bought | % Change | Weight % |
|---|---|---|---|---|---|
| No Recent Buys Data | |||||
| Ticker | Put/Call | Amount Sold | Shares Sold | % Change | Weight % | Status |
|---|---|---|---|---|---|---|
| No Recent Sells Data | ||||||
| Industry | Prev Quarter % | Current Quarter % | Change |
|---|---|---|---|
| No industry data available | |||
